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HR Fundamentals for Startups

While employing a human resources department could be considered standard for larger, more established companies, more than half of startups in 2023 claimed to have no dedicated human resources support.

Why is this?

Startups, especially in the early stages, are particularly low on resources and staff which can make hiring a full HR team less of a priority. However, the lack of even one trained HR professional within a startup can be detrimental to its overall growth and success. This is largely because other team members tend to take on these responsibilities, or those in charge may never feel 100% comfortable in how best to look after the team.

Even if your startup isn’t at a place where it can take on a HR professional, it is imperative to still keep these HR essentials in place while running your business.

So what are these HR responsibilities?

HR departments are responsible for several key tasks within the workplace to ensure everything functions as it should:

Talent Acquisition / Staff Onboarding

By handling new hires, HR can help your startup grow efficiently and effectively. Once fully integrated into the company, they will be able to help you forecast staffing needs, and complete new employees’ onboarding as well. The talent acquisition process can include writing up job vacancies, standardising and overseeing the interview process, and conferring with payroll on salary arrangements.

Upon joining the company, HR will then ensure their onboarding process is a seamless transition into the team. These tasks will often include drafting contracts, collecting necessary documentation like P45s or Right to Work, ensuring the new hire has access to all accounts and tools they need, and many more.

Top Tips for Startups:

  • Even without a HR team or professional you can still come up with a simple recruitment strategy to make the talent acquisition process more seamless for your startup. Try offering your new hires more flexibility such as remote working or offering the opportunity to participate in an EMI options scheme.

  • At a startup every hire has a big impact, to ensure you’re hiring the right team members considering holding multiple interviews or giving candidates a take-home task giving them an opportunity to showcase their passion and expertise.

  • Time is not always on your side when working for a startup so it’s important to embrace feedback throughout the entire onboarding process – from both sides! Give your new employee an opportunity to give you feedback as well as vice versa. This will ensure you’re both on the same page and reduce employee turnover.

Employment & Business Laws

Regardless of whether you have a designated HR team or not, it’s incredibly important to have a Health & Safety Policy, Disciplinary/Dismissal Policy, and Grievance Policy set in place. Having these, along with having current business & employer’s liability insurance are part of HR’s responsibilities to remain in line with labour laws, regulations, and policies.

Your HR team will ensure your company is enrolled in a workplace pension scheme, as well as manage any holiday or sick leave.

Top Tips for Startups:

  • Create an employee handbook that is read and signed by new joiners. In the handbook you can address any foreseen concerns such as notice periods, dress codes, or how to handle discrimination harassment offenses.

  • Managing employment and business laws can be both time and admin heavy. Luckily there are cost-effective software options which can help startups manage time and duties without a full HR team, these include, or even keeping a detailed Google Sheets spreadsheet.

  • Invest in a reliable payroll software, this will not only save you time but also ensure you aren’t in violation of any expensive payroll laws.

Company Culture & Ethical Behaviour

This can be difficult for some startups to navigate. Smaller, close-knit teams are not immune to conflict, which can be strenuous to manage without a HR department. While they can be responsible for maintaining company culture, it is also HR’s position to ensure ethical behaviour in the workplace, and take action against those who don’t. Their intervention in conflict will ensure that even the smallest and most casual startup remains a professional workplace environment.

Top Tips for Startups:

  • An employee handbook will help in navigating these disputes. By setting out your company values and policies in the handbook you will have a set of guidelines for your team to follow.

  • Founders are generally time poor, so if you don’t have time to schedule regular performance reviews or check-ins with your employees ensure line managers are taking the time to engage with staff.

  • Reward hard work and celebrate accomplishments both big and small! This will go a long way with building trust with your employees and promoting a positive work environment.

  • Even without a dedicated HR team you can still invest in your employee’s well-being. Whether this is a competitive benefits package, mental health support services or wellness programmes.

While it can definitely be difficult for smaller or early-stage startups to hire a whole HR team, it can definitely be useful to invest in some HR-management software to ensure you’re covering these essentials.

Whether or not you invest in a HR software or not, it is entirely manageable to run your startup without a designated HR Team. By understanding what the basic responsibilities of HR are, a founder can either take it upon themselves or delegate to line-managers to ensure they get done to maintain a safe, professional work environment.


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